Step One

In order to finance or refinance a loan, the lender requires documentation to verify and substantiate your employment, credit and financial situation to assure its investors that you have the ability to repay the money. This documentation may consist of tax returns, recent pay stubs, bank statements, verifications of employment, deposit and rent or mortgage, appraisal, purchase agreement, divorce decrees, bankruptcy papers and any other information the lender deems necessary.

Step Two

You will have to provide a completed loan application and the requested documentation to me for submission with your package to be underwritten. We can complete the loan application easily over the phone in a matter of a few minutes.  I will then provide you with a list of documents needed to process the loan. I will be the intermediary between you, the borrower, and the underwriter. The underwriter is the person who goes through the documentation and information you have provided with a fine-tooth comb to make sure everything fits the program requirements. You will not be able to speak with underwriter - it is my job to communicate information to and from the borrower.

Step Three

Expect to wait. Be patient!  It may take several days to a week to get the initial response from the underwriter depending on how busy they are. In our market, many lenders have scaled back on staff in an effort to cut overhead, which means longer review times. The underwriter will either approve the loan as it is or, more likely, provide a list of items that need clarification or additional documentation.

Step Four

Expect to be asked to provide additional items. Once you give these to me, it will be a few days before you hear back again. The underwriter may come back several times with certain "conditions." Don't be concerned. The underwriter is simply doing an underwriter's job. At this point, what you have is conditional approval - meaning, your loan is approved pending removal of these conditions.

Step Five

The entire loan process typically takes between two and four weeks, possibly longer, depending on the particular circumstances of the loan. Loans for self-employed people, people with poor credit, or people with unusual circumstances often take longer because of the additional documentation required.  Loans can be funded in as little as 7-10 days in rush circumstances as long as all documentation can be provided and an appraisal secured.

Step Six

Once the loan is approved, the loan papers will be sent to the escrow/title company or your attorney. The escrow officer or attorney will add other documents to the file created from information received from the lender. Once these documents are prepared, the escrow officer or attorney will contact you to set up an appointment for you to come in and sign your papers.

Step Seven

Expect to wade through and sign a mountain of papers. The escrow officer or attorney should provide you with a copy of everything you sign.

Step Eight

Understand that from the date you sign your papers, it will be another day or two until the loan is funded, which is when the money is transferred from the lender to the Escrow Company.

Step Nine

Know that the loan will close, or record (with the county), one or two days after the loan has been funded. Once the loan is recorded, the transaction is complete.

 

Tips & Warnings

• Unforeseen delays, such as problems getting an appraiser or information from an outside source, will slow the loan process.

• Lenders will require a paper trail for money that has been deposited into your account. The paper trail will verify from where the money came and that the money is not a loan that will have to be paid back. So, if the underwriter discovers that a large amount of money has been deposited into your account, the underwriter may want documentation of where it came from.

• When you go to sign your loan papers, bring your driver's license or some form of picture identification. You will most likely also need to bring money to settle your transaction. Make sure to ask whether you will need a cashier's check or any other special requirements to complete the transaction.